Purpose-led Growth: Marketing Catchphrase or the Foundation of Organisational Success?

The phrase “purpose-led growth” gets thrown around a lot (we would know since we talk about it frequently). But what does it mean? And most importantly, is it simply a marketing catchphrase or foundation for continued organisational success??

Frankly, it’s a significant question because (corporate) purpose touches on the most critical issues in the world right now – climate change, systemic inequalities, cost-of-living crisis, and global health.??

There are five key things to consider when demonstrating why establishing a company’s purpose is the foundation for future fortune.?

Many people conflate ‘purpose’ with Environmental Social Governance (ESG) or corporate philanthropy.??

While an understandable misunderstanding, purpose is not the same.??

ESG is a set of standards measuring impact on society, the environment, and their accountability, and corporate philanthropy refers to company activities they voluntarily initiate to manage their impact on society. Chiefly, they are concerned with how a company acts.?

Purpose is why a company exists and the foundation on which all else is built, like corporate philanthropy and ESG.?

Some people associate purpose with marketing – or even communications – but it’s so much more.??

As we outlined previously, often overarching ideas, like sustainability and purpose, are mistakenly placed into the responsibility of marketing departments.?

While being clear about what you stand for, why you exist, and your role in the world can inspire powerful marketing – like the purpose poster child Patagonia – this is not the same as embedding purpose into every part of the organisation.?

Profit as purpose is not sustainable.?

While profit as a metric is something we cannot escape (after all, money does make the world go round), ignoring the need for purpose at a time when our world is facing a climate emergency with the highest land and ocean temperatures ever recorded, a cost-of-living crisis, and systemic inequalities is irresponsible.??

Unfortunately, this sharply contrasts with the behaviour exhibited by many corporations. In June, Shell’s new CEO, Wael Sawan, laid out the company’s strategy saying Shell will devote a higher proportion of spending to oil and gas, which will include maintaining oil production at current levels of 1.4 million barrels daily until 2030 and expanding its giant liquefied natural gas business. Although Sawan claims Shell will still aim towards reaching net zero emissions by 2050, Shell will invest $40 billion over the next three years in oil and gas production while only spending $10 to $15 billion on low-carbon technology, which appears contradictory.?

Purpose without profit is not sustainable either.?

Profit is a necessary component of any corporation; to reinvest, to create more Real Impact, and to nurture teams – a significant cycle that must continue.?

Most importantly, this defines Skating Panda’s raison d’etre – we pursue profit through purpose by working hand in hand with companies to turn intent into impact without forgetting commercial goals.??

Becoming purpose-led usually requires change, and change isn’t easy.?

Behavioural science tells us humans associate change with loss and minimise loss more than optimise gains. Thus, any change, even towards something positive, is a significant barrier to overcome.??

The answer lies in understanding the habits that are part of life inside the organisation and establishing new rewards and routines to create new habits. There is a range of proven techniques to achieve this, from occupational psychology to storytelling, to modelling behaviours in leadership.?

Can defining and embedding purpose in an organisation create problems if something goes wrong??

At Skating Panda, we believe the opposite to be true. Unlike the adage stating nothing kills a bad product faster than good advertising, defining your purpose, embedding it in your organisation, communicating it publicly, and remaining accountable can only strengthen a company if a crisis occurs.?

Becoming purpose-led makes decision-making easier and clearer. It enables a quick and credible response; it makes it easier for internal and external stakeholders to stay engaged, interested, and trusting.?

If you want to start your journey to becoming a purpose-led organisation, please email us at [email protected].?